United Kingdom

UK approves five offshore projects for CfD subsidy

UK: The UK government has put five offshore projects among the first eight renewable energy developments to qualify for its new 'contracts for difference' (CfD) subsidy regime.

The 600MW Walney extension is among the projects approved

The developers of the projects, with a combined capacity of 3.2GW will now be able to claim a guaranteed price for the electricity generated from the projects.

Dong Energy has seen three of its projects approved for the subsidies. They are the 258MW Burbo Bank extension in the Irish Sea, 1.2GW Hornsea 1 in the North Sea and 660MW Walney Extension also in the Irish Sea.

Repsol and SSE's 664MW Beatrice in the north east of Scotland was also given the green light to claim the subsidies. Dudgeon, a 400MW wind farm being developed by Statkraft and Statoil, has also been approved.

All of the projects are currently under development and will be able to claim the subsidies from 2015.

The inclusion of Beatrice in the list of approved projects is somewhat of a surprise, with the wind farm not originally featured in a pre-approved list released in December.

The CfD system will see generators receiving a top-up payment when the wholesale electricity price is below a pre-agreed 'strike price' and paying money back when the price rises above it.

Offshore wind prices will be £155/MWh in 2015, before falling to £150/MWh in 2016-17 and £140/MWh in 2018-19.